Law: Wealth Tax Act, 1957

Section: 14(2),18(1)(a),18B

Wealth tax--- ----Penalty---Waiver or reduction---Failure to furnish return within time--­Imposition of penalty---Return filed voluntarily and in good faith prior to issue of notice under S.14(2)---Full cooperation extended to Department in enquiry relating to assessment proceedings though several adjournments obtained relating to obtaining of valuation report---Total tax involved only Rs.7,000---Fit case where penalty should be reduced to 50 per cent of what had been levied---Indian Wealth Tax Act, 1957, Ss. 14(2), 18(1)(a) & 18-B. The Wealth Tax Officer imposed penalty under section 18(1)(a) of the Wealth Tax Act, 1957, for the assessment years 1972-73 to 1975-76, on account of failure of the appellant to furnish a return of net wealth within the time allowed under the Act. The appellant filed a petition under section 18-B of the Act for waiver of the penalty on the grounds that he had voluntarily and in good faith made full disclosure of his net wealth by filing the returns for the assessment years in question prior to issuance of any notice under section 14(2) of the Act and that he had cooperated in the enquiry relating to the assessment proceedings for all the assessment years. The Commissioner refused waiver on the ground that the assessee had obtained several adjournments on various grounds, some of which related to obtaining a valuation report and hence, the assessee had failed to cooperate with the Department. On appeal to the Supreme Court: Held, allowing the appeal, that the total tax involved in all the assessment years was only Rs.7,000 and that the assessee had voluntarily filed the returns before the issuance of any notice. Therefore, taking into account the facts and circumstances of the case, this was a fit case where the penalty should be reduced to 50 per cent. of what had been levied. JUDGMENT Leave has been granted in the present appeal in respect of the question of penalty imposed on the appellant under section 18(1)(a) of the Wealth Tax Act which was not waived and/or reduced under section 18-B of the Wealth Tax Act by the Commissioner. The assessment years involved are 1972-73 up to 1975-76. For the assessment year 1971-72, this…

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